Financing an Imported CNC Machine in Canada

Imported CNC financing starts with the same question as any equipment purchase

The lender first needs to understand what your business is buying.

Provide the manufacturer, model, year, serial number if available, purchase price and seller. If the machine is used, include photos, the listing and any condition information you have.

The difference with an imported machine is that the purchase does not end when the seller gets paid. The equipment still has to cross the border, clear customs and arrive at your facility.

That means the financing conversation should include the full transaction from the beginning.

Build the delivered cost before you apply

The seller's price is only one part of an imported equipment purchase.

Your project may also include freight, rigging, customs brokerage, duties, taxes, insurance, installation and electrical work.

List those costs separately. Do not combine them into one unexplained number.

A lender may be comfortable financing some project costs and not others. The answer depends on the financing source and the way the transaction is structured.

If the machine is priced in another currency, make that clear as well. A Canadian dollar budget can change if the purchase price is fixed in U.S. dollars or euros and the exchange rate moves before closing.

Know who will act as the importer

Commercial goods entering Canada have to be properly declared and accounted for.

Before the machine ships, your business should understand who is responsible for the import process, whether a customs broker will be used and what information is required to release the equipment.

The Canada Border Services Agency uses the CARM system for commercial importing. If your company has never imported equipment before, do not leave that setup until the truck is already at the border.

The lender needs a clear foreign seller

A recognizable machinery dealer with a formal invoice is usually easier to document than an unknown private seller overseas.

If you are buying from a private company, the lender may need additional information about the seller and the machine.

Ask for a proper invoice or purchase agreement that identifies both parties and the exact equipment being sold.

If the seller is receiving payment in another country, provide the payment instructions early. Do not assume the lender can send funds anywhere without reviewing the recipient first.

Used imported machinery needs extra attention

A used CNC machine may look attractive because of price or availability, but distance makes due diligence more important.

If you cannot inspect the machine yourself, decide how you will get comfortable with its condition before committing.

Photos, videos, maintenance records and an independent inspection can help, depending on the machine and transaction.

The financing company is evaluating the credit and asset. It is not guaranteeing that the machine will arrive in the condition you expect.

Keep the customs paperwork consistent with the financing file

The commercial invoice, purchase agreement, equipment description and financing documents should all describe the same transaction.

If one document says the purchase price is one amount and another says something different, expect questions.

The same applies to the machine description. A model number that changes between the seller invoice and shipping paperwork can create unnecessary delays.

What should you have ready?

• Seller name and country
• Machine manufacturer, model, year and serial number if available
• Purchase price and currency
• Seller invoice or purchase agreement
• Estimated freight and rigging costs
• Customs broker information if one is being used
• Expected shipping date
• Expected arrival date
• Your business information and reason for the purchase

Do not wait until the machine is in transit

Imported purchases are much easier to finance when everyone understands the plan before the seller ships the machine.

If the lender has questions about the seller, value or structure, you want those questions answered while the equipment is still under your control.

If you are still deciding whether the machine should be new or used, start with our CNC machine financing guide. If you already have an overseas machine selected, you can send Raymond Leigh the quote and transaction details for review.